Valuetronics BN2 has reported earnings of HK$123.0 million ($21.3 million) for the FY2023 ended March 31, 8.3% higher than earnings of HK$113.5 million in the year before.
Earnings per share (EPS) for the year stood at HK29.1 cents.
The higher earnings were attributable to the surge in other income, which more than doubled to HK$32.0 million from HK$14.7 million in the year before as interest income was boosted by the US Fed’s interest rate hikes during the year.
Revenue for the year, however, dipped 0.7% y-o-y to HK$2.01 billion as the decline in consumer electronics (CE) revenue more than offset the growth in revenue for the industrial & commercial electronics (ICE) segment.
During the year, revenue for ICE grew by 19.7% y-o-y to HK$1.58 billion due to higher demand from the group’s ICE customers while CE revenue fell by 38.7% y-o-y to HK$433.4 million mainly due to the softening demand in end-markets.
FY2023 gross profit fell by 4.8% y-o-y to HK$261.7 million due to the high base in the 1HFY2022 which saw higher component prices on the back of the shortage. On a full-year basis, Valuetronics’ gross profit margin fell though it experienced a recovery in the 2HFY2023 as the component shortage relaxed.
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As at March 31, cash and cash equivalents stood at HK$1.01 billion.
In its outlook statement, the group notes that it continues to face challenges as its customers defer orders to manage their inventory levels in response to weakened market demand. It adds that it expects to see pressure on its GPM in the FY2024 ending March 31, 2024, with persisting challenges in the component supply chain.
“Despite the challenging environment, the group’s strategic decision to establish a manufacturing site in Vietnam has yielded positive results. Through its regional manufacturing footprint strategy, the group has attracted new customers seeking to diversify their supply chains while benefiting from lower labour costs in different countries across Asia. This move has positioned the group well to capitalise on evolving global supply chain dynamics in its customer acquisition strategy,” says Valuetronics in its statement.
As at 9.29am, shares in Valuetronics are trading 2.5 cents higher or 4.9% up at 53.5 cents.
